The importance of knowing dependent and independent demand models to companies is that it is a way for one to be able:
- To understand inventory.
- Be able to depict the number of units of a specific product that the consumers are said to be willing to by at each price.
<h3>What is independent demand and dependent demand?</h3>
Independent demand is known to be the demand for a given finished product. It can be a machine, a car. etc.
The dependent demand is known to be the demand for a component area of a finished good, such as the wheels on a car.
Note that the Dependent demand is one that is obtained from the demand for a finished product.
Therefore, The importance of knowing dependent and independent demand models to companies is that it is a way for one to be able:
- To understand inventory.
- Be able to depict the number of units of a specific product that the consumers are said to be willing to by at each price.
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Answer: $66.25
Explanation:
What should the per unit selling price be to make a 25% profit this year?
First, we'll calculate the total cost which will be:
= $100,000 + $5000(33)
= $100,000 + $165,000
= $265000
%profit = 100(revenue - cost)/ cost
25% = 100(revenue - 265000)/265000
Therefore, revenue will be:
265000(1 + 25%) = 331250
265000(1.25) = 331250
Revenue = $331250
Selling price per unit will be:
= $331250/5000
= $66.25/unit
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Answer:
Antonio and Replacement of Golf Clubs
a. He should cash the CD and use the proceeds to finance part of the golf clubs.
b. The reason is that he would pay more in in-store financing totaling $37.06 per annum than the net interest he would generate from the CD totaling $23.18 per annum. And Antonio would incur a net loss of $13.88 if the CD was renewed unlike the $5.74 if the CD were not renewed.
Explanation:
Option 1: Renew Certificate of Deposit (CD):
Interest earned = $33.48 ($600 * 5.58%)
Taxes = 10.30 ($33.48 * 30.75%)
Net Income = $23.18
Cost of in-store financing = $37.06 ($710 * 5.22%)
Net Loss(overall) = $13.88 ($37.06 - $23.18)
Option 2:
Sale-off of CD = $600
Net financing required = $110 ($710 - $600)
Cost of financing = $5.74 ($110 * 5.22%)
The correct answer is letter B